By Kelly Cloonan

Lululemon Athletica is scheduled to report its fiscal first-quarter results after the market closes Thursday. Here is what you need to know:

PROFIT: The yoga pants maker is expected to post a profit of $315.5 million, or $2.60 a share, according to analysts polled by FactSet. In the same quarter the previous year, the company reported earnings of $321.4 million, or $2.54 a share.

REVENUE: Sales are expected to rise to $2.36 billion from $2.21 billion a year ago, according to FactSet.

COMPARABLE SALES: Same-store sales, which adjust for store openings and closings, are expected to climb 4.1%, down from a 6% increase a year ago.

The stock has fallen 12% year to date and was recently trading at $337.30.

WHAT TO WATCH

--Lululemon is expected to post slower same-store-sales growth in the quarter amid a tough macroeconomic environment and intense competition in the athleticwear space. In the company's latest earnings call, Chief Executive Calvin McDonald said consumers are spending less due to concerns about inflation and the economy, leading to slower traffic across the industry in the first quarter. Industry data also shows Lululemon's web and in-store traffic continues to slow and underperform peers, a trend that is likely to continue as competitors build stores and increase brand awareness, Jefferies analysts said in a note.

--All eyes will be on Lululemon's full-year guidance, which is expected to reiterate its previous outlook for sales growth of 5% to 7%, down from 10% growth in 2024. This deceleration would mark the company's slowest growth rate on record, according to FactSet. The company will also likely maintain its prior guidance for earnings per share of $14.95 to $15.15 even with tariff effects, given it will likely mitigate added costs with vendor concessions and price increases, UBS analysts said in a note.

--Investors will also be closely watching whether the company's new product innovation, including its new Align No Line pants released last month, will drive a sales inflection in the U.S., Deutsche Bank analysts said in a note. While sales trends appear steady to improving, Lululemon will likely need to introduce more new products to sustain any further U.S. growth, they said.

Write to Kelly Cloonan at kelly.cloonan@wsj.com

(END) Dow Jones Newswires

June 04, 2025 14:38 ET (18:38 GMT)

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